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US petroleum exports hit new record in first half of 2022

The United States exported a record amount of
petroleum
products in the first half of the year as high demand and disruptions associated with the
war in Ukraine
drove tightness in global energy
markets
.

Exports averaged nearly 6 million barrels per day during the period between January and June, representing an 11% increase in average daily exports compared to the same period last year, according to data published Monday by the Energy Information Administration.


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Nearly all petroleum products contributed to the higher rate of exports, the EIA said. Larger volumes of distillate fuel oil, which encompasses diesel fuels and fuel oils, and hydrocarbon gas liquids, which include propane, contributed most to the increase. Propane was the top petroleum product by volume exported in the first half of the year.

The increase in petroleum exports has come amid broader growth in fossil fuel production and exports in the past few years. President Joe Biden campaigned on transitioning the economy away from fossil fuels and has pursued regulations to boost renewable energy sources and limit future use of carbon-emitting power sources. But he
has presided
over a major recovery in production from the pandemic and has encouraged greater oil production to lower prices in recent months.

The January-June period was characterized by historically high crude oil prices, which sent prices for associated refined products higher as energy demand strengthened around the world where countries continued their emergence from COVID-19-related slowdowns in economic activity.

Russia’s invasion of Ukraine was also largely responsible for the higher prices, sending shock waves through global energy markets and fracturing long-standing energy trade relationships between Russia and much of the West.

The U.S.
quickly moved
to ban imports of Russian fossil fuels, and the United Kingdom will stop importing Russian oil and gas by the end of the year.

The European Union, Russia’s top energy customer, has also
committed
to a ban on most Russian petroleum imports, which is to take effect in December. The longer runway has allowed European countries to continue importing Russian petroleum products in the meantime.

“Because these sanctions have not yet gone into effect, we have not seen the expected increase in U.S. exports to Europe, and instead exports to Europe decreased to 71,000 [barrels per day] in the first half of 2022,” EIA said, “while U.S. distillate exports to Latin America increased to more than 1 million b/d.”

U.S. propane exports to Europe increased, however, by 51% over the first half of the year.


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The export boost came alongside requests from a handful of liberal interest groups and Democrats in Congress for the administration to
limit energy exports
, especially oil, gasoline, and natural gas, in order to increase supplies at home.

The administration entertained the idea of limiting exports as recently as June, when average retail gasoline prices reached their highest level on record, but the policy would conflict with Biden’s initiative to help European allies shoulder their gradual breakup with Russian energy.

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